If Tesla Ran Healthcare

Would things be different if Tesla ran healthcare?   For one thing, there would be more charges.

OK, bad joke.

Nevertheless, everyone it seems is looking for the killer (kind of a bad term) app in healthcare or the big technology disruptor as Tesla has done with automobiles.   So far, it has not been found.

Sure there are things like urgent care centers with iPads for registration and emergency services which advertise their current waiting times on freeway signs.  Not to be forgotten in this list of non-disruptors are the boo-boo clinics in drug stores.

There are the call centers maintain by health plans where you can call with your health concerns.  Their main goal seems to be to prevent you from going to where you really want to go–your doctor or local hospital emergency service.

Don’t forget the Silicon Valley heroes who are looking to cause disruption in healthcare.  Who can forget Theranos, the brainchild of a 19-year-old Stanford drop-out?  If you have forgotten that sad story of non-disruption disruption, you should watch the excellent documentary currently showing on HBO about this fraud.

Where is Bones from Star Trek with his Tri-Corder?  That handy handheld gadget could diagnosis anything!  Captain Kirk often found himself on the receiving end of the Tri-Corder.  That was real disruption.

Maybe instead of looking at disruption we should lower our sights and simply look at improving service to patients.   That’s where two recent experiences with Tesla come to mind.  Tesla is about much more that technology.

Last week I got two flat tires over the span of four days on my Tesla Model S.  That’s a problem since Teslas don’t have spare tires and towing them is tricky and requires a special technique for reasons I don’t comprehend.

My flat tires were on separate wheels and both were on busy I-80 in the Bay Area.  I called Tesla’s roadside assistance number and they quickly sent out a truck emblazoned with the Tesla logo. My flat tires became a status symbol as cars flashed by.


In the truck was a supply of new loaner tires which would be put on my car if the tire could not be repaired on the spot. The first flat tire was repaired and in 30 minutes I was on my way.  The second flat tire later in the week was removed and a loaner tire put on.  The service was superb in both instances.

That got me to thinking about healthcare and its service component.  Like Tesla, we provide a high cost product or service.  Unlike Tesla, we seem to have a difficult time meeting expectations in terms of how we provide our service.  Long waits and poor communication are more the norm in healthcare.  Why is it despite our best efforts that level of non-service continues?

As I was writing this entry, an example of non-service in healthcare came to my attention.  A friend called who was concerned about his very elderly mother.  She was not eating, getting weaker by the day and beginning to have problems with activities of daily living.  She recently had a stroke. Was she suffering a physical problem or depressed?

She was resolutely refusing to go see her doctor who practiced in a very well-known integrated healthcare system here in California.  Her son found her primary care physician uninterested in trying to arrange a home evaluation.  He tried several ways to enlist aid from the healthcare system to no avail.  It finally took an outside physician friend who wrote a  letter he could send under his signature to gain the healthcare system’s attention.  The letter contained enough trigger words so it was no longer possible for the healthcare system not to do the right thing.  A home telemedicine consultation was arranged.

I think even more highly of Tesla after my two experiences last week. Contrast Tesla’s approach with my friend’s experience with a healthcare system which never misses an opportunity to publicly pat itself on the back. If Tesla ran healthcare,  things would be done differently.

When was the last time you felt there was a true service commitment from your healthcare provider?

I find myself beginning to believe that true disruption in healthcare does not require cutting edge technology, a fancy app or even a Tri-Corder.  The way to true disruption is a lot simpler.  Take care of patients in a way that meets their needs rather than  those of the provider or health plan.  In the long run that pays off.


The Case For Mountain Dew

I hit the beach two years ago this month.  My involvement with healthcare has been a more distance affair as a result—-unless it involves members of my extended family.  Then I often get an earful.

Since the first of this year, a  number of family members have had encounters with healthcare including two hospitalizations.  These encounters have included care from three very large healthcare systems and two smaller systems.  I have been keeping notes of what I have seen and will share them here:

Who’s In Charge?

The healthcare provided to my family members has been satisfactory  and in some cases superb.  If you look at the process of healthcare as involving segments of care, each segment of each hospitalization my family members experienced went well.  It was at the connecting points within each hospitalization where things sometimes did not go well.

There needs to be further thinking about how to make hand-offs of care from one provider or work shift go better.  This extends as well to the segment of care which is post hospitalization. Often, patients and their family members were not adequately kept in the information loop.  Whomever figures out a way to make the patient care process consistently go more smoothly and in a coordinated way is going to get rich or at least appreciated.

Why Do We Bother With the EMR?

Electronic medical records are great!  They improve patient care.  If you are a provider, you get punish if you don’t use one. That has been the hype.

I don’t buy the EMR hype any longer although before I hit the beach I was an enthusiastic supporter of EMRs. Reality has set in.

A recent personal experience. I just had my annual physical which I have every 18-24 months, longer if I can get away with it.  I have a great primary care physician.  He asks all the right questions even if a number of them are a little embarrassing.  His scribe takes it all down.

His scribe?  Yes, there is a third-party in the exam room with me and the doc.  It’s a little get together. That’s because the EMR which was supposed to make life easier for the physician has done the opposite.  What used to involve just the doctor has required the addition of another person. Two’s company, three’s a scribe.

So now there is the distraction of the scribe tapping away my answers to personal questions.  So much for my fifteen minute appointment.

EMRs have become a burden and with the lack of interoperability between systems not very useful when the information is most needed.

What Can Be Done About Electronic Tumors?

There was a time when at work you were expected not to make personal phone calls or otherwise divert your attention from your work.  Not anymore.  Everyone has electronic tumors, usually attached to one of their hands or ears.

In virtually every clinical setting I saw staff during the time they were supposed to attend to the business at hand,  accessing personal cell phones.  I saw it in doctor offices, nursing stations, in hallways and in other outpatient areas. It’s not a good look and to outsiders conveys a lack of interest in patients.

Interestingly, I seldom saw physicians with the cell phone affliction.  They seemed much more focused on their patients and their needs.  Perhaps a new surgical procedure can be developed for cell phone amputation. It will be painful.

Why Could I Not Get A Mountain Dew?

I have spent hours recently in four different hospitals worrying about a family member. It can be very stressful when a family member is sick enough to be in the hospital. You need to be emotionally comfortable in such situations.

My favorite hospital was NorthBay Medical Center but not for the reason you may think. The reason is that at NorthBay you can get a Mountain Dew with SUGAR! Liquid comfort— and caffeine—was readily available.

The other hospitals have decided to become food nannies and do not sell  sugared soft drinks.  I have been to their cafeterias and vending machines and all you can get is high price water and soft drinks artificially sweetened (if that is the word) with complex chemical compounds.  Research is inconclusive as to whether these chemicals are good for you or will cause your nose to fall off.

I also observed Starbucks refugees in these food nanny cafeterias loading their cups of coffee with sugar. Some sugar is better than other sugar?

What I found even more galling at the other hospitals is that they blithely sell donuts, pastries and ice cream which are full of sugar.  The food nannies are not consistent.  Or maybe they just like donuts. I had two one morning just to spite the food nannies.

Visiting and worrying about a loved one is stressful enough.  Having access denied to soft drinks with SUGAR is an insult and a micro aggression.  I am an adult fully capable of making my own decisions.

I think I am going to sue.  I need my Mountain Dew.

Hopefully the next few months on the beach will not be so stressful. I will always have a six pack of Mountain Dew—with SUGAR— close by for comfort.




There is a place for story telling in organizations.  At NorthBay Healthcare we used stories to reinforce our culture.  Stories work best if there is substance to back them up.  Otherwise, the recipients of stories can get cynical.

I thought about stories the past week when “Haven” was grandly announced.  This is the improbable name of the nonprofit organization formed by the CEOs of Amazon, J.P. Morgan and Berkshire Hathaway. What was Haven’s name supposed to convey?

“Haven” to me sounds more like a name better suited for a church or homeless shelter but I am sure the branding experts at these three companies spent hours and many dollars to come up with it.  I could have done it for free for them.

More to the point, was this another ego stroking effort by three prominent CEOs? Was that the story?

The mission of Haven per their website is as follows:

“Our mission is to transform health care to create better outcomes and overall experience, as well as lower costs for you and your family.”

That’s their public story and they are sticking to it.  Notice as usual, the initial emphasis in the mission statement is on quality.  It is only in the last clause they stick in “lower costs” as also part of their mission.

Haven’s CEO, Dr. Atul Gawande, made it clear that the cost of health care was a driving force in creating Haven.  In a memo he said the following:

“Haven was formed by the leaders of Amazon, Berkshire Hathaway, and J.P. Morgan because they have been frustrated by the quality, service and high costs that their employees and families have experienced in the U.S. health system.”

I feel the same way about the cost of my Amazon Prime membership which keeps going up.  And don’t get me started about J. P. Morgan which holds my home mortgage. I hope every month they will lower my interest rate but alas I hope in vain.

I think I will start an organization to address this issue of the costs of super large corporations. I’ll call it “Craven”. No one will mistake that for a church.

More seriously, one can be encouraged by the fact that Dr. Gawande is involved in this latest venture by do-gooding, profit maximizing, publicity seeking CEOs. He has written several compelling books about health care quality.  He also is a very good speaker on this subject.  Whether his leadership will be sufficient to make a difference remains to be seen.

There have been no shortage of other organizations with a similar focus formed by business organizations.  Usually, after a year or two, they wither away as the sponsoring organizations lose interest or focus or change CEOs.

Management guru Peter Drucker once said hospitals were  “the most complex human organization ever devised”.

Given Drucker’s opinion, it is obvious that an internet peddler of goods, a bank which caters to the wealthy and a company which collects other companies are perfectly suitable to revolutionize healthcare including hospitals. You just have to develop an app.

Peter Drucker in his writings recognize that a service industry like healthcare is inherently more complicated than other endeavors like selling and loaning. That does not mean healthcare should be exempt from examination of its practices. That’s happening everyday in healthcare.

I don’t believe the issues of cost and quality are really amendable to a top down approach as seems to be the way organizations like Haven view things.  Even with a star as its leader, Haven seems a reach. Perhaps a better name for Haven would be “Hubris”. That may be the real story here.







Last week I contended that the increasing utilization of hospital emergency services is a good thing.   Before anyone else could do it, I then excommunicated myself from the punditry religion which as a matter of dogma feels otherwise.

This week I will expose myself to possible capital punishment by committing a felonious act against the common view held by a motley crew of policy makers, “leaders” of large healthcare delivery organizations and consultants always on the lookout for a new opportunity to offer their services. Where is Joan of Arc when you need her?

So what heinous act am I committing?  It has to do with the Affordable Care Act (aka “ACA” or “Obamacare”). The ACA was not just a vehicle for mandating insurance coverage.  There were other goodies in its 2000 plus pages including the hospital “Value Based Purchasing Program” or VBP which would be applied to the Medicare program.

VBP also sometimes goes by the more accurate name of “Pay For Performance”.  You don’t see that term used as often as it seems crass to policymakers and politicians, neither of whom wants the public to know what they really are up to.

Under VBP, the Medicare people issued an ever-changing set of goals which if hospitals met them, they would receive a bonus in Medicare reimbursement.  Not meeting the goals would result in a decrease in reimbursement.  The goals would change from process oriented (i.e., did you do the right thing for the patient) to outcome oriented (i.e., how did the patient do) and back again.  With the constant changes in goals and the bureaucracy necessary to oversee VBP, things got complicated.

The VBP was embraced by leaders of large healthcare delivery organizations who always are seeking virtue and a possible cover story about their virtuous selves in “Modern Healthcare” magazine. Here is a way to improve quality, they croaked

Insurance companies also eyed pay for performance as perhaps being adaptable for their  contracts with hospitals.  The insurance companies were not interested in virtue or quality; they were interested in a better bottom line.  VBP gave them good cover.

Your eyes will quickly get crossed if I go into too much more detail.  We are now eight years into VBP and the results are at best mixed.  Studies disagree as to whether VBP has resulted in an improvement in patient care however it is defined.  VBP or pay for performance so far is a disappointment to policymakers but a continued boon to Medicare bureaucrats.

It also is a bit of paradox.  VBP awards more money to hospitals for doing what they are supposed to do, at least according to the goals issued by Medicare.  You get less money if you don’t meet the mark.

Why should you get more money than standard Medicare reimbursement for simply meeting, not exceeding, a standard of care?

There can be very good reasons, particularly for outcome related goals, that a hospital misses a goal.  It may not have enough patients in a given year subject to the goal to adequately measure performance.  It may serve a demographic segment which is less compliant.  A strong case can be made that these hospitals should receive MORE not less reimbursement in light of their circumstances.

At its core,  VBP or pay for performance is not about quality.  It is yet another cost control mechanism.  That is a hard truth that the virtue seekers heading large healthcare systems refuse to acknowledge.

Modern Healthcare recently had this quote in an article about alternatives to VBP that might be more effective:

“We pay more for our healthcare in the U.S. because we pay our providers more,” said Christopher Koller, president of the Milbank Memorial Fund and a former Rhode Island health insurance commissioner. “We have to put the whole system on a diet and let them figure out how to live with it.”

Aside from being Captain Obvious, this guy deserves credit for being honest about the actual intent of the VBP. He has no future in politics.

There you have it.  It’s about money and the solution is to reduce reimbursement. Medicare already pays what it wants for care.  Just ratchet it down further.  End the pretense about it being about quality.  Watch more hospitals, particularly in rural areas, go out of business.

I cannot wait to see how this works under M4A (Medicare For All).

Excuse me as I have a date with the firing squad.



Last week the Public Policy Institute of California (PPIC) released an interesting report on “Emergency Department Use in California–Demographics, Trends, and the Impact of the ACA”.  As the report’s title suggests, a primary focus was whether the Affordable Care Act (aka “Obamacare”) increased utilization of hospital emergency services.  

PPIC’s study found that while what they called “ED outpatient visits” did significantly increase it was not due to the implementation of the ACA.  “ED outpatient visits” was defined as patients “being treated and released the same day”.  Sort of like catch and release when fishing. PPIC expressed concern about the cost of such care and whether alternative ways of dealing with patient needs should be developed.

There is nothing new about the kinds of concerns the PPIC study noted.  Emergency services seem to meet a need but that is vexing to policymakers.  Everyone knows increased emergency service use  is not a good thing, right?

I will now commit heresy.  What’s wrong with something that meets a need, a need which keeps growing?  If I was a member of the pundit religion, I would be excommunicated for that statement.   There is nothing wrong though in questioning orthodoxy.

Emergency services clearly fill a need beyond the traditional idea of saving a life. Mothers with a baby with a high temperature want the reassurance of a physician doing an assessment–even if it is midnight on a Saturday.  An older man with a bad cold and a memory of once having pneumonia wants someone to reassure him that all he needs is some chicken soup and time and he will be better–even if the cost is a hospital bill and several hours time. It goes on and on.

Consider members of the millennial generation who appear not to be particularly enamored with an on-going relationship with a primary care physician. They are young and not creaky. They have a smart phone and if a health app does not cure what ails them there is always the corner urgent care center, assuming it is open after a hard night of playing Fortnite.

Most urgent care clinics are not open late at night and have limited capabilities when they are open.  Some restrict what insurances they will accept.  Don’t believe me? Look at their websites.  The same goes for the clinics in stores.  They are at best partial solutions to a bigger need.

Then there is the difficulty in accessing your primary care physician if you are lucky enough to have one.  Most offices are overwhelmed with patients, some of whom have waited a long time just to get a physical.  When the need is urgent in your mind, you want more rapid accessibility. and the ability to just drop in.

Emergency services have everything a patient may need all in one convenient place, 7 days a week, 24 hours a day.  Yes, they are more expensive than an urgent care center.  The analogy I have used in the past is that a loaf of bread in a 7-11 convenience store is more expensive that the same loaf at a supermarket but try finding that loaf in the early hours of the morning.  Accessibility and comprehensiveness comes with a cost.

In any other field, a service which finds itself in great demand would be considered something worthwhile and worth expanding.   Instead of  devoting more resources to making the patient flow process better in emergency services, we look to alternatives which the market place is not interested in buying.

I don’t believe we should be fighting what the market wants.  Providers and pundits are wrong to do that.  Instead, let’s find a way to make emergency services more efficient and able to take care of the growing demand.  Give emergency services more room to live in and continue to increase the use of nurse practitioners and physician assistant working together with physicians specializing in emergency medicine.

At my core, I am a hospital guy.  Despite the learned but ignorant claims of academics and pundits, hospitals are not dead.  They live and if you doubt it, just go to your local emergency service. People are voting with their feet.

I know all of this is a minority opinion and counter to the punditry religion.  Consider me excommunicated.







I usually like to be a little light hearted when making observations about the state of healthcare. That separates me from the serious pundits, most of whom have never run a Boy Scout first aid clinic, much less a complicated healthcare delivery organization. I hope I am not being unfair to the Scouts. This time I am going to be serious.

In the past week two significant developments occurred which demonstrate that being a relatively small healthcare organization is not the same thing as being a chump.

The first development involved NorthBay Healthcare, the organization where I had been CEO. A few months before I retired (hit the beach as I like to refer to it)  as NorthBay Healthcare’s CEO in 2017, two large health plans cancelled their contracts and began paying NorthBay whatever they deemed appropriate for emergency care and any resultant inpatient care.

Imagine that you go into a supermarket and decide you have the ability to determine the price you will pay for an item without regard to the cost of the item.  Imagine the reaction of the supermarket. That was what those two health plans were doing while NorthBay was providing a very valuable, often life saving, service to their plan members.

One plan was Blue Shield of California and the other was Kaiser Foundation Health Plan. Neither plan to the best of my knowledge allows its customers to decide what premiums they will pay for health insurance.

This practice resulted in a significant revenue shortfall for NorthBay.  Meanwhile both plans were highly profitable and building their reserves to an amount which exceeded regulatory requirements.  It became clear that the only recourse for NorthBay was to the courts.  Both health plans were sued by NorthBay.

The Blue Shield case was decided in a San Francisco Federal Court last week. The jury decided after a very short period of deliberation in NorthBay’s favor. Blue Shield now will be required to pay NorthBay for lost revenue.

Blue Shield, in an absurd, hilarious and fanny covering press release, tried to spin the verdict as if it was the victor.  No one was buying what they were selling.  That jury’s decision should help other healthcare providers faced with similar situations.

Make no mistake, if you are a health plan and end a contract, you do not have the right to unilaterally decided what you will pay for the care provided to your beneficiaries.

Next up is the Kaiser case which involves even more revenue.  NorthBay’s main hospital is the most comprehensive medical center in Solano County and Kaiser members and the health plan have greatly benefited from its emergency services.

At another time I will explain my belief that health plans, except those owned by provider organizations, are part of the problem with the structure of health care today.

In another telling development, Oroville Hospital in Northern California successfully sold $200 million in bonds for a new wing.  Like NorthBay in 2016, Oroville found that they could have sold even more than $200 million given the demand in the marketplace.

NorthBay and Oroville are among a group of stellar independent health care organizations who jointly own a risk retention company which provides high quality risk management services.  There are ways of getting the benefits of “bigness” without sacrificing your local community to control by corporate giants and the risk retention company is just one example. You don’t need to be a mega-monster healthcare system to deliver cost-effective, high quality care.

The marketplace is belatedly recognizing that the huge organizations which are trying to dominate healthcare, whether they are health plans or corporate providers of patient care, come with excessive costs, lack of focus, ego-driven management and poor results.  And that is just for starters!

Meantime, if  you are looking for chumps, you best look at the big guys.  They are hard to miss.

Missing The Disney Gene


Sometimes when you are on the beach you find yourself doing things you don’t particularly like because others who are important to you love doing those things. That is the reason I found myself at Disneyland last week with my older son and his family.

I am baffled by why so many people love the Magic Kingdom.  It was crowded even during a week in February when all those kids should be in school spreading their germs rather than doing it in Anaheim.

What puzzles me the most is how the presence of Disney employees  dressed in character costumes make grown people lose their sense of dignity.  Kids going bonkers over a facsimile of Mickey Mouse or Goofy I can understand. However, what is up with the adults?  I saw grown women elbowing away little kids so that they could do selfies with Chip and Dale and Pluto.  I’m a Minnie Mouse type myself.

Even more baffling is the riot that ensues every “Magic Morning”.  That is the early entry every morning for a select few a hour before the usual opening time.  The select few number well into the thousands.  You gain entry to the park after undergoing a security check and then are corralled at the end of Main Street awaiting a signal to start your strollers.  When it comes, bedlam erupts as thousands of Moms pushing strollers rush pell mell up Main Street to gain early entry to rides.  In our case, we veered to the right heading to Fantasyland to get to the Peter Pan ride.  By the time we parked our twin grandsons’ stroller in the designated parking space (yes, Disney has parking spaces for strollers), the Peter Pan line was 30 minutes long.

I have come to the conclusion that I belong to a minority born without the Disney gene.  It can be a lonely existence as you wait two hours in line to take a five-minute ride.  For those with the gene, the time flies!

Even not possessing the gene, however, I have come to appreciate the way Disney delivers a consistently great experience.  They are in many ways a model worthy of emulation.

Some years ago I heard the late Fred Lee, author of “If Disney Ran Your Hospital: 9 1/2 Things You Would Do Differently”, give a presentation.  I was so impressed that I ordered a copy of his book for every one of my organization’s managers.  Eventually I arranged for him to give a series of seminars to the managers.  I think it made a big difference in how we approached patient care and particularly patient satisfaction.

I see interesting contrasts. Both Disney and healthcare organizations charge what is considered premium prices for what they provide.  Premium is a nicer way of saying high prices.  

Disney customers don’t complain about the prices; they keep coming back.  Disney has perfected no hands pick pocketing. No dollar bill goes unspent and no credit card goes unswiped when visiting Disney’s parks. This makes people happy. Disney is awesome!

Patients do complain about prices, even when the care is excellent.  A life can be saved and three weeks later you get a complaint about the bill. There is a disconnect in health care from the value proposition.  Patients don’t seem to think their experience was worth the cost.

Then there is the crowd factor. As I indicated previously, Disney fans don’t seem to be bothered by long lines and crowds. That is not the case in health care where long waits are deemed unacceptable.

A final contrast is the focus on making the experience better.  I was getting emails from Disney throughout my stay asking about my family’s experience about various aspects of our visit.  They knew which restaurants we ate at and what rides we took and they wanted to know that day how it had gone.

Healthcare organizations are also concerned about the experience of those we serve. We just don’t do a very good job in monitoring on a contemporaneous  basis that experience so that we can make adjustments as needed.

I understand that running theme parks is a different business than providing health care.  There is though much we can continue to learn from organizations like Disney which meet a different set of needs than we do in health care.

There is yet another gene which Disney has and many other organizations in health care and in other fields appear either to lack or have not activated. That gene has nothing to do with tolerance for large crowds or adults acting like kids. That second Disney gene is about a consistent commitment to doing things better.

I know we all try to do things better but our patients often don’t agree with the results. Time for some genetic engineering.